18
pensions as percentage of GDP. It shows that in 2000 spending on public pensions accounted for
an average of 10 per cent of GDP, albeit with considerable variation across the EU member
71
states.
Table 1: Public expenditures (including public replacement revenues) to people aged over 55
before taxes (as % of GDP) - current policy scenario
|
2000 |
2010 |
2020 |
2030 |
2040 |
2050 |
PEAK | |
|
Belgium______ |
10,0 |
9,9 |
11,4 |
13,3 |
13,7 |
13,3 |
3,7 |
|
Denmark_____ |
10,5 |
12,5 |
13,8 |
14,5 |
14,0 |
13,3 |
4,1 |
|
Germany_____ |
11,8 |
11,2 |
12,6 |
15,5 |
16,6 |
16,9 |
5,0 |
|
Greece________ |
12,6 |
12,6 |
15,4 |
19,6 |
23,8 |
24,8 |
12,2 |
|
Spain__________ |
9,4 |
8,9 |
9,9 |
12,6 |
16,0 |
17,3 |
7,6 |
|
France_________ |
12,1 |
13,1 |
15,0 |
16,0 |
15,8 |
./. |
4,0 |
|
Ireland_________ |
4,6 |
5,0 |
6,7 |
7,6 |
8,3 |
9,0 |
4,4 |
|
Italy_____________ |
13,8 |
13,9 |
14,8 |
15,7 |
15,7 |
14,1 |
2,1 |
|
Luxembourg |
7,4 |
7,5 |
8,2 |
9,2 |
9,5 |
9,3 |
2,2 |
|
Netherlands |
7,9 |
9,1 |
11,1 |
13,1 |
14,1 |
13,6 |
6,2 |
|
Austria________ |
14,5 |
14,9 |
16,0 |
18,1 |
18,3 |
17,0 |
4,2 |
|
Portugal________ |
9,8 |
11,8 |
13,1 |
13,6 |
13,8 |
13,2 |
4,1 |
|
Finland________ |
11,3 |
11,6 |
12,9 |
14,9 |
16,0 |
15,9 |
4,7 |
|
Sweden______ |
9,0 |
9,6 |
10,7 |
11,4 |
11,4 |
10,7 |
2,6 |
|
United Kingdom_____ |
5,5 |
5,1 |
4,9 |
5,2 |
5,0 |
4,4 |
-1,1 |
|
EU________ |
10,4 |
10,4 |
11,5 |
13,0 |
13,6 |
13,3 |
3,2 |
Source: Economic Policy Committee (2001: 22).
The table shows a rise of public spending for old-age security between 3 and 5 per cent of GDP in
most member states over the next five decades, although the projected rise in spending on public
pensions is significant sporadically. The evolution of public pension expenditures can be consid-
ered by examining member states in groups: the UK is the only member state to actually project a
decrease in public pension spending as a share of GDP. Relatively low increases between 2 to 3
per cent of GDP are projected for Italy, Luxembourg and Sweden. The countries that face the
biggest challenges on pension expenditure are Spain and Greece, where increases in spending of 8
and 12 per cent of GDP are projected, respectively. The suggested policy recommendation is to
70
The projections cover old-age pensions, early retirement pensions, disability and survivors pensions as well
as other replacement income for persons aged over 55. Cf. Economic Policy Committee (2001: 21).
71
The EPC pointed out, that these difference, in part, stem from the fact the public pensions in some coun-
tries include earning-related schemes with entitlements dependent upon past contributions: this tends to
lead to a higher level of public spending on pensions. In contrast, public pension schemes in other countries
operate on a more flat-rate basis, often aiming at providing a minimum level of retirement income: these
public pensions are supplemented with private occupational schemes and/or private savings which fall out-
side the public sector, and consequently the scope of this projection exercise. Some of the differences may
also arise from the variability in the coverage of the projections. Cf. Economic Policy Committee (2001:
22).